# Chaos Labs Risk Stewards - Increase Supply and Borrow Caps on Aave V3 - 07.10.25 **URL:** \ **Category:** Governance\ **Created:** [July 10, 2025, 9:01pm UTC](https://governance.aave.com/t/chaos-labs-risk-stewards-increase-supply-and-borrow-caps-on-aave-v3-07-10-25/22557 "2025-07-10T21:01:31Z")\ **Posts on this page:** 2\ **Page:** 1
**Author:** ![ChaosLabs](https://dub1.discourse-cdn.com/flex013/user_avatar/governance.aave.com/chaoslabs/32/6850_2.png) [@ChaosLabs](https://governance.aave.com/u/ChaosLabs)\ **Post date:** [July 10, 2025, 9:01pm UTC](https://governance.aave.com/t/chaos-labs-risk-stewards-increase-supply-and-borrow-caps-on-aave-v3-07-10-25/22557/1 "2025-07-10T21:01:31Z")
## **Summary** A proposal to: - Increase EURe’s supply and borrow caps on the Gnosis instance. - Increase FBTC’s supply cap on the Ethereum Core instance. All cap increases are backed by [Chaos Labs’ risk simulations](https://cdn.sanity.io/files/zmh9mnff/production/130e1060165f7ab0766bb4c70cc2ec41c1d1e458.pdf), which consider user behavior, on-chain liquidity, and price impact, ensuring that higher caps do not introduce additional risk to the platform. ## EURe (Gnosis) EURe has reached full supply cap utilization and 95% borrow cap utilization, resulting in an overall utilization rate of 82%. ![image](https://europe1.discourse-cdn.com/flex013/uploads/aave/original/2X/4/411c180e29707049a0ce9d6497960b4bdcf0c1cc.png) ![image (1)](https://europe1.discourse-cdn.com/flex013/uploads/aave/original/2X/9/9d14a727dc5fc8d8be4053fa676faaad7afb4fb5.png) ### Supply Distribution Supply is highly distributed, with the largest user accounting for just 16% of the total. ![image (2)](https://europe1.discourse-cdn.com/flex013/uploads/aave/original/2X/0/0977eeb829249c37d19ecb2a6ebde4bacd668eed.png) Additionally, the asset cannot be used as collateral and thus this market is at very low risk on the supply side. ### Borrow Distribution Borrowing is also highly distributed, with no user accounting for more than 20% of the total amount borrowed. ![image (3)](https://europe1.discourse-cdn.com/flex013/uploads/aave/original/2X/a/af695c1bd26fc7d84ee296d46d93f5ec02c9cf86.png) The most common collateral asset against EURe is sDAI, putting the market at low risk of large scale liquidations because of the strong correlation between the two assets. ![image (4)](https://europe1.discourse-cdn.com/flex013/uploads/aave/original/2X/5/5204505394921582cd539b0b9568d7803544eb9c.png) ### Liquidity EURe’s on-chain liquidity is sufficient to support an increase in its caps, as a 2M EURe ($2.34M) swap for sDAI can be completed with less than 1% price slippage. ### Recommendation Taking into account the low-risk borrowing activity in this market relative to its on-chain liquidity, we recommend increasing the asset’s supply and borrow caps. ## FBTC (Ethereum Core) FBTC has reached nearly full supply cap utilization following new deposits while its borrow cap remains lightly utilized. ![image (5)](https://europe1.discourse-cdn.com/flex013/uploads/aave/original/2X/d/dc50865da497412c8bf9252cdcab1863923f1cdf.png) ![image (6)](https://europe1.discourse-cdn.com/flex013/uploads/aave/original/2X/9/9c53336f6073ea17b77f152c31dea72bd4833a80.png) ### Supply Distribution Supply is relatively concentrated, with the largest user accounting for more than 70% of the total. This user is borrowing USDT against both FBTC and RLUSD with a health score of 2.54, putting the user at low risk of liquidation. ![image (7)](https://europe1.discourse-cdn.com/flex013/uploads/aave/original/2X/b/b59ec3178a864287bb86a4127fe736c8d2fece95.png) The second largest user is borrowing WETH against cbBTC and FBTC with a health score of 1.41, putting them at a higher risk of liquidation. Largely because of these two users, the top borrowed assets against FBTC are USDT and WETH. ![image (8)](https://europe1.discourse-cdn.com/flex013/uploads/aave/original/2X/1/12268c8e646ef4e05c24ea8e3a65ea0af5b26f5d.png) ### Liquidity FBTC’s on-chain liquidity is sufficient to support an increase in its supply cap, as a 150 FBTC to USDT swap can be completed at 5% price slippage. ### Recommendation Taking into account the asset’s relatively strong liquidity and low-risk usage, we recommend increasing its supply cap. # **Specification** | **Instance** | **Asset** | **Current Supply Cap** | **Recommended Supply Cap** | **Current Borrow Cap** | **Recommended Borrow Cap** | | --- | --- | --- | --- | --- | --- | | Gnosis | EURe | 13,000,000 | 16,000,000 | 11,200,000 | 15,000,000 | | Ethereum Core | FBTC | 600 | 900 | 100 | - | # **Next Steps** We will move forward and implement these updates via the Risk Steward process. # **Disclaimer** Chaos Labs has not been compensated by any third party for publishing this AGRS recommendation. # **Copyright** Copyright and related rights waived via [CC0](https://creativecommons.org/publicdomain) ---
**Author:** ![system](https://europe1.discourse-cdn.com/flex013/uploads/aave/original/2X/e/e11637c36f45ffa158f2146f5c19438d46e0824d.svg) [@system](https://governance.aave.com/u/system)\ **Post date:** [August 9, 2025, 9:01pm UTC](https://governance.aave.com/t/chaos-labs-risk-stewards-increase-supply-and-borrow-caps-on-aave-v3-07-10-25/22557/2 "2025-08-09T21:01:32Z")
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